All you wanted to know about organic food in the EU

EU_Organic_Logo_Colour_OuterLine_rgbThis contribution aims to provide you with a brief overview of the EU Organic legislation and recent developments. Being able to market products as ‘organic’ could be a plus for the food business operator (FBO) as the demand for sustainable production and organic food increases. This contribution focuses on the EU-system of organic certification of food products and will specifically look at the position of organic microalgae manufactured in the EU. Under the current legislative framework, these could not be marketed as such in the EU. This has changed since an interpretative note of the Commission of last summer. If you are an FBO interested in marketing organic microalgae, this for sure is of interest to you.

Organics Regulation – scope

First of all, what is ‘organic production’? According to recital 1 of the Organics Regulation organic production is: “(…) an overall system of farm management and food production that combines best environmental practices, a high level of biodiversity, the preservation of natural resources, the application of high animal welfare standards and a production method in line with the preference of certain consumers for products produced using natural substances and processes” (see also the definition in Article 2(a)).

What is covered by the Organics Regulation? Only agricultural plants, seaweed, livestock, aquaculture and animals are regulated under the Organics Regulation. For example, if an FBO wants to produce organic seaweed, all the processes have to be in compliance with the Organics Regulation. This approach is known as the ‘farm to fork approach’, which means every step in the production process throughout the supply chain has to comply with the Organics Regulation.

Organics Regulation – structure

The Organics Regulation has a layered structure. The following three layers of provisions can be found:

  1. General production rules (articles 1, 7 – 10), which apply to all forms of organic production.
  2. Production rules for different sectors (articles 11 – 21): general farm production rules and production rules for specific categories of products and production rules for processed feed and food.
  3. Detailed production rules (article 42).

If there are no production rules for the sector (layer 2), only the general production rules (layer 1) apply.

Organics certificate

Compliance with the Organics Regulation has to be demonstrated by obtaining certificates from a certification body. (See the following link for a list of competent certification bodies in different Member States). In the event a certification body audits the FBO marketing organic products and it encounters violations of the Organics Regulation, it can decide to block certain non-compliant batches of products pending an investigation. Depending on the outcome, the certification body can subsequently decide to withdraw the certificate. If the certificate is withdrawn, the FBO is no longer allowed to market the products as ‘organic’. In case of severe violations, the competent authority may impose a recall of the products. In the Netherlands, Skal Biocontrole is the designated Control Authority responsible for the inspection and certification of organic companies in the Netherlands, within the context of Regulations: (EC) Nr. 834/2007 (Organics Regulation), (EC) Nr. 889/2008 and (EC) Nr. 1235/2008 (import of organic products from third countries). Skal monitors the entire Dutch organic chain on behalf of the Dutch Ministry of Economic Affairs.

The EU organic logo

The EU logo is regulated in a separate Commission Regulation. The main objective of the European logo is to make organic products easier identifiable by the consumers. Furthermore it gives a visual identity to the organic farming sector and thus contributes to ensure overall coherence and a proper functioning of the internal market in this field. For practical information regarding the EU logo, see this link and this link.

Organic microalgae

Prior to July 2015, FBO’s could not obtain an organic certification for microalgae manufactured within the EU for the use in their food products. FBO’s from third countries (non-EU) could market their products in the EU based on either the import procedure as set out in Article 33 (2) (import from recognised third countries) or the import procedure laid down in Article 33 (3) of the Organics Regulation (import of products certified by recognised control bodies). The strange situation was created where ‘organic’ microalgae could only be imported into the EU and not be produced within the EU.

How come? All agricultural products were considered to fall within one of the different production rules for specific categories of products (layer 2) and microalgae for food production were not included. Furthermore, detailed EU production rules for microalgae were absent (layer 3). (Article 42 (2) Organics Regulation).

The Interpretative note of the European Commission (Directorate-General for Agriculture and Rural Development) of July 2015 opened up the possibility for companies in both EU Member States and third countries to produce microalgae, which can be marketed as ‘organic’ and carry the EU organic logo. Both the existing production rules for plants (Article 12 Organics Regulation) and seaweed (Article 13 Organics Regulation) could be suitable for microalgae.

‘Until an implementing act adopted on the basis of Article 38 (of Regulation 834/2007) has clarified the situation, operators producing organic micro algae (except for use as feed for aquaculture) have therefore to comply with the general production rules, which apply to all forms of organic production (“layer 1”) and with the production rules for the sector of plants or seaweed (“layer 2”).’

The use of microalgae as feed for aquaculture is not covered in the Interpretative note, as microalgae as feed are already subject to the detailed production rules. The rules for the collection and farming of seaweed apply according to Article 6a of Commission Regulation (EC) No 889/2008.

The interpretation opens up the possibility to certify microalgae to be used as food (or as an ingredient in food) as being organic. When an implementing act will be published and enter into force is still unknown. A proposal for a new Regulation repealing the Organics Regulation has been published. On 5 November 2015 a report from the Committee on Agriculture and Rural Development on the proposal was published, introducing 402 amendments. The current status of the proposal is available through this link.

Aside from enforcement by a national control authority in case of non-compliance with the Organics legislation, consumers and other interested parties often also have the possibility to lodge a complaint relating to advertising of organic products. However, advertising of (organic) products is a topic to be covered in another contribution on Food Health Legal. Stay tuned!


Novel Foods – the final verdict?

Amsterdam Westerpark. Foodfestival De Rollende keukens. Bij deze bus kan men snacks kopen die gemaakt zijn van insecten, zoals gefrituurde sprinkhanen op een stokje of meelworm loepia'sThe heat was on today in the European Parliament (EP).  The reason for that was that the new Novel Foods Regulation was put to vote in a plenary session. In the debate prior to the vote, the opinions centred between concerns about food safety and the free circulation of goods. In this post, you will be updated about the outcome of the vote. In short, the adoption of the new Novel Foods Regulation will have important consequences for Food Business Operators (FBO’s). In an earlier post, we already reported about streamlined authorisation procedures. Today, we will mainly focus on the type of products covered by this legislation. Insects are in for a start. In a 10 minutes read, you will learn what are the consequences thereof – and more.

Shaping the new Novel Foods Regulation

Today (28 October 2015), the EP adopted the latest proposal for a Regulation on Novel Foods [insert final text]. As reported in one of our previous posts, the European Commission published an initial proposal for this Regulation in December 2013. EP Rapporteur Nicholson heavily criticised this draft, mainly for its open product definition and for the lack of streamlining the authorisation procedure. As a result, an EP legislative proposal became available, in which the Rapporteur formulated a number of improvements. Most of them were included into the draft legislation approved by the ENVI committee by the end of November 2014, which further developed into the text voted today. This adopted proposal will enter info force after publication in the OJ. However, a transition period of 24 months after such publication has been provided before its actual application.

So what are Novel Foods finally?

In the initial Commission proposal, the various product categories had not been exhaustively defined. Although such a system could present the advantage of flexibility, in fact FBO’s resisted against the legal uncertainty this would create. As a result, the approved draft by the ENVI Committee identified 10 categories of Novel Foods. Some of these have again been heavily debated, like for instance insects – however without success. The Regulation voted today in the EP defines the following products as Novel Foods:

  1. food with a new or intentionally modified molecular structure;
  2. food consisting of or isolated / produced from microorganisms, fungi or algae;
  3. food consisting of or isolated / produced from material of mineral origin;
  4. food consisting of or isolated / produced from plants or their parts, except when the food has a history of safe food use in the Union and one out of two alternative conditions are met;
  5. foods consisting of or isolated / produced from animals or their parts, except where these animals were obtained from traditional breeding practises and the food from those animals has a history of safe food use;
  6. food consisting of or isolated / produced from cell or tissue culture derived from animals, plants, micro-organisms, fungi or algae;
  7. food resulting from a production process not used within the Union before 15 May 1997, giving rise to significant changes in the composition or structure of a food, affecting its nutritional value, metabolism or level of undesired substances;
  8. food consisting of engineered nanomaterials;
  9. vitamins, minerals and other substances, where a new production process has been applied or where they contain engineered nanomaterials;
  10. food used exclusively in food supplements within the Union before 15 May 1997, where it is intended for use other than in food supplements.

 What’s in? – Most striking changes

Contrary to the ENVI proposal, the current text of the Regulation no longer mentions food derived from cloned animals or their descendants as a separate product category. However, it becomes clear from the recitals in the new Novel Foods Regulation that no change is intended here. Until specific legislation on food from animal clones enters into force, such food is covered by category nr. 5 of this Regulation, as food from animals obtained by non-traditional breeding practises. Another textual change relates to category nr. 8. Whereas the ENVI draft still specified the highly debated 10 % threshold for a food ingredient to qualify as nano (instead of the 50 % threshold proposed by the Commission), no such threshold is contained in the current text. Although this is no doubt a compromise solution, it is expected it shall give rise to new discussions. A real change with respect to the ENVI proposal relates to product category nr. 3, covering food of mineral origin. For now,  the background of this change remains unclear. Finally, insects are still covered by category nr. 4. Today, many food products consisting of or containing insects are marketed in various Member States. It is therefore important to establish what will be the consequences of considering insects as Novel Foods. In order to answer that question, the provisions laying down the transition regime are of interest. Furthermore, by way of background, a number of safety evaluations of insects as food are briefly discussed.

Evaluation of insects as food by certain Member States

In one of our previous blogs relating to the marketing of insects as food products, we reported that due to the lack of clarity regarding the status of insects (Novel Foods or not?), some Member States issued their own guidance. In Belgium for instance, the placing on the market of 10 particular insects species as food product is tolerated, provided that specific food law requirements are met. In the Netherlands, the Dutch Food Safety Authority and the Health Minister ordered a safety report with respect to three types of insects currently marketed as food in the Netherlands. These are the mealworm beetle, the lesser mealworm beetle and the locust, regarding which the heat-treated and non-heat treated consumption was evaluated in terms of chemical, microbiological and parasitological risks. Based on the outcome, it was recommended to consider these insects as “regular” foods (in the sense of the General Food Law Regulation) and not as Novel Foods.

Evaluation of insects as food and feed by EFSA

On 8 October 2015, EFSA published its Risk profile related to production and consumption of insects as food and feed ordered by the Commission. In fact, EFSA was requested to assess the micro-biological, chemical and environmental risks posed by the use of insects in food relative to the risks posed by the use of other protein sources in food. EFSA found that for the evaluation of micro-biological and chemical risks, the production method, the substrate used, the stage of harvest, the specific insect species and the method of further processing are of relevance. It established however that with respect to any of these topics, fairly limited data are available. It therefore strongly recommends further research for better assessment of microbiological and chemical risks from insects as food, including studies on the occurrence of hazards when using particular substrates, like food waste and manure.

Transition regime

How to deal with insects as food products that are currently marketed? The new Novel Food Regulation provides first of all that these products do not have to be withdrawn from the market. However, for the continued marketing of such food products a request for authorisation should be filed within 24 months after the date of application of the new Novel Food Regulation. This would come down to the following.

  • Entry into force of new Novel Foods Regulation: 1 January 2016 (assumption)
  • Date of application of new Novel Foods Regulation: 1 January 2018
  • Ultimate date for filing authorisation for continued marketing of insects as food: 1 January 2020.

This means that roughly speaking 4 years from now, FBO’s offering insects as food should still obtain a Novel Food authorisation. Assuming that these products have been marketed since the end of 2014 (see for instance the news on the launch of the insect burger sold by Dutch grocery chain JUMBO), this would mean that they were on the market 5 years before. If no safety concern ever arose so far, it would not be unreasonable to request an exemption from this obligation. At any rate, such FBO’s should know that prior to the indicated date of 1 January 2020, they can most likely successfully rebut any enforcement measures by local food safety authorities.

Conclusion

The adoption of the new Novel Foods Regulation has been a process with quite a few hick-ups and some surprising results. Whereas food from cloned animals for a long time had been the cause of delay, it is surprising to see that this Novel Food category nevertheless ended up within the scope of the new Novel Foods Regulation. As to products providing alternative protein, such as insects, we understand that the safety aspects from rearing to consumption should be carefully assessed. However, we note that EFSA does not have any immediate safety concerns per se. Furthermore, it should be stressed that the notion of “safety” in EU food law has only been negatively defined. That is, food is safe as long as it is was not found unsafe. Therefore, we consider that alternative protein products that were marketed for a number of years without any problems reported should not be subject to further barriers. Anyhow, FBO’s should be aware of their rights of continued marketing of such products, at least for four more years to come.

Want to know more about this subject? Do join the Axon Seminar on Alternative Proteins: invitation seminar.

Image: Amsterdam Westerpark, food festival “The Rolling Kitchens“, serving snacks made out of insects, such as fried grasshoppers on a stick or mealworm spring rolls.

 

 


180 fold higher fines in Dutch Commodities Act

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On 11 September 2015 new legislation amending the current Commodities Act (in Dutch: Warenwet), partly entered into force. Under the new legislation the maximum administrative fine to be imposed on Food Business Operators (hereinafter: ‘FBO’s’) by the Dutch Food Safety Authority (NVWA) is increased dramatically compared to the prior maximum fine. The Dutch legislator has clearly increased existing fines to make them stronger and more effective to increase compliance with food safety regulations. The NVWA has more teeth, but will it bite?

The rationale behind the increased fines

A reason to increase the maximum fines can also be found in the battle against food fraud in general. Until recently the NVWA could impose a fine on an FBO on the basis of Article 32 of the Commodities Act. The maximum fine was set at € 4.500. According to its latest annual report, the NVWA imposed 2808 fines on FBO’s in 2014. The average amount of a fine was € 1.206,– and the total amount of imposed fines was € 3.413.893,–. Considering the costs of compliance with hygiene and administration standards, these penalties are merely peanuts for the average FBO and do not have the desired effect of contributing to compliant behavior as is confirmed by the statement further down in this post.

Fines linked to system under Dutch Penal Code

Fines in other areas such as data protection law are also subject to revision and they will both increase and expand (meaning an increased number of provisions will be subject to potential fines in case of non-compliance and those fines tend to increase as well). With a political climate both in the EU and in the Netherlands that leans towards stronger enforcement instruments, it was just a matter of time before the fines under the Commodities Act would be increased. The Dutch legislator seems to try to harmonize the several fines in different legal acts by referring to the categories of fines specified in the Dutch Penal Code. These categories are linked to the severity of the violation. The first category is the lowest and the sixth category the highest. The maximum fines are now set at the maximum of the sixth category: € 810.000,– (or 10% of the annual turnover). This means a 180 fold higher maximum fine!

In relation to the increase of administrative fines politician Sjoera Dikkers (Dutch Labour Party – PVDA) stated: “it is clear that a fine of 4.500,– is cheaper for practically every company, then acting in compliance with hygiene practices in the Netherlands. For a fine of 81.000,– this can be similar for big companies, depending on the nature of the infringement. That is why we would like to further increase the maximum penalty to the sixth category. This is the only way to scare companies enough to make sure they comply with hygiene requirements.

The exact amount of the fine will have to be proportionate and therefore depend on factors such as the number of employees, the degree of culpability, the severity of the violation and/or the turnover of an FBO. The NVWA has to assess all individual circumstances in order to establish the amount of the fine.

Final thoughts

Although relatively low fines indeed might give rise to profit for FBO’s from non-compliance and fraudulent behavior, drastically increasing the fines could have a downside for both the NVWA and the FBO’s. Imposing higher fines requires more effort and expertise from the NVWA. For fines that exceed the amount of € 340,– additional procedural requirements, similar to criminal law, have to be met by the NVWA. For FBO’s a high fine could indeed have a significant impact and even potentially mean bankruptcy. As we have seen in Dutch cases relating to the horsemeat crisis, the NVWA can impose the execution of a recall that can lead to bankruptcy. We will keep you informed on how this potential powerful enforcement instrument of high fines in the hands of the NVWA is handled in practice and dealt with in court. Hopefully, this will serve FBO’s in establishing what should be done to avoid or annul the decision of the NVWA to impose such fines, which is a part of our active practice.

The author is grateful to Floris Kets, trainee at Axon Lawyers, for his valuable contribution to this post.

 

 


Who Does Not Want To Have A Healthy Breakfast?

Crude health blackThe Netherlands Food and Consumer Product Safety Authority (NVWA) has been pretty active this Summer. Following up on previous enforcement reports on nutrition claims,  it recently published such enforcement report re. both nutrition and health claims for breakfast cereals. As this report relates to legislation that has been harmonized at an EU-wide level and it provides detailed enforcement information, this is an interesting read – not only for the Netherlands.

Less than 50 % fully compliant

Actually, the report publishes data on the review of claims regarding 126 different breakfast cereals marketed under 24 different brands. These data were compiled during the period between March – October 2014. From this review, It appeared that less than half of those products were fully compliant with the Claims Regulation. The NVWA considers it of the essence that Food Business Operators (FBO’s) offering for sale breakfast cereals fully comply with the Claims Regulation to enable consumers to make informed choices.

Nutrition and health claim framework

Since the entry into force of the Claims Regulation on 1 July 2007, only authorized claims can be used for food products. A claim is a message or representation in any form, that is not mandatory under EU law or national legislation and that states, suggests or implies that a food has certain characteristics. A nutrition claim is a claim that states or implies that a food has particular beneficial nutritional properties in terms of energy and/or nutrients. A health claim is a claim that states or implies there is a relationship between food and health. Amongst the health claims, a distinction is made between general claims, disease risk reduction (DRR) claims and claims relating to the health and development of children. In 2012, the Commission published a list of 222 authorized general claims that is dynamic and has currently evolved into 229 claims. Furthermore, there are currently 14 authorized DRR claims and 11 children’s claims. For both nutrition and health claims, strict conditions of use are applicable. For instance, in order to claim that a product is high in proteins, at least 12 % of the energy delivered by the product should be provided by proteins.

Method of enforcement

Contrary to previous claims enforcement reports that only related to nutrition claims, the NVWA this time also took into account health claims. More concretely, it report relates to pre-packed breakfast cereals that were offered for sale in the Netherlands at both retail and wholesale level. If the products at stake were advertised at websites as well, such information was also subject to enforcement. The products at stake consisted of granola, corn flakes, puffed rice grains, oatmeal and wheat meal, some of them supplemented by nuts, sugar, dried fruits or chocolate. The information reviewed was the name of the product and the nutrition labelling, in as far as related to nutrition and health claims. A warning letter was sent to those FBO’s whose products were not compliant, except when an unauthorized claim was used In those cases, a fine was imposed under the suspensive condition of full compliance within a grace period. When I contacted the NVWA to know the average amount of such fine, I was informed that my query would be answered within 6 weeks. Apparently, the Summer scheme is still on at NVWA – too bad. But an update will be provided at FoodHealthLegal when more information is available.

Outcome of enforcement

As mentioned above, out of the 126 products that were reviewed, over half of them did not fully comply with the Claims Regulation, mostly because the claims used were pretty vague. Although it is permitted to use a variation on an authorized claim, the essence thereof should be the same as an authorized claim. An example of a claim that was sanctioned by the NVWA is “The cereals present in this product are the basis for a healthy and nutritious breakfast. It contains nutrients that are indispensable for the human body and that are quickly absorbed by the body.” Another reason why products were not compliant was that non-existent nutrition claims were used, such as “does not contain cholesterol” or “ contains many nutrients”. Furthermore, sometimes nutrition claims were made, whereas the strict conditions of use were not met. Although this is not visible from the product label, such is a violation of the Claims Regulation as well. Finally, on many products, the link between a specific nutrient and the health claim used on the labelling was missing. Instead, pretty general, non-specific, claims were made that can be quickly taken in by the consumer, but also easily be misunderstood. Therefore, such general, non-specific claims are only allowed if accompanied by a specific, authorized, health claim. For example, the claim “Crisply granola of brand X forms part of a healthy and nutritious breakfast” cannot be used alone, but it can be used jointly with an authorized claim for iron, like “Iron contributes to normal energy-yielding metabolism”.

Recommendations

The fact that the NVWA nowadays actively enforces health and nutrition claims shows that it considers B2C communication on food product to be an integral part of food safety. From our practise I know changing the packaging of your food products is a lot of hassle, so better get it right as from the start. Here are a few tips to help you along.

  1. At all times, it should be avoided to made a medical claim with respect to food products. Medical claims are claims directed at the prevention or treatment of a disease. Their use, if allowed at all, is strictly reserved for pharmaceuticals.
  2. If you consider the authorized claims are not persuasive or sexy enough, choose one of the variations published by the self regulatory body KOAG-KAG.
  3. Make sure you have data supporting the nutrition facts of your food product, as the burden of proof lies with the FBO when receiving a request pertaining thereto from the NVWA.
  4. When using general, non-specific claims, use the specific, authorized claim in the same field of vision.
  5. When in doubt, or if you simply need a sparring partner, consult an expert.

 


The Vegetarian Butcher – or how to protect the goodwill vested in your trademark

Secvegetarian-butcheruring proteins from alternative sources than meat or fish is nowadays a topic in the centre of the debate. The Dutch Vegetarian Butcher has found a solution for this challenge by manufacturing and marketing meat-alikes. These are food products having the taste and bite of a meat product, but that are composed of non-meat ingredients such as soy. The trademark used for this type of products was at the basis of a recent decision of the Amsterdam District Court. However, this case contains some general learning for any food business operator caring about his trademark.

Outline Partnership

The Dutch Vegetarian Butcher was operating a butcher shop in The Hague and had concluded a collaboration agreement with a commercial partner to operate a similar shop in the centre of Amsterdam. The terms of the collaboration agreement stipulated, inter alia, that the Amsterdam based Vegetarian Butcher was allowed to use the Vegetarian Butcher trademark and trade name. In fact, the shop in Amsterdam was to operate as a flagship store of Vegetarian Butcher products in the Dutch capital. The contract therefore provided that the Amsterdam shop was only to a very limited extent allowed selling third party products.

Collaboration in practise

In practise, the collaboration between the parties did not work out as expected. During several test visits of the Vegetarian Butcher shop in Amsterdam, freezers turned out to be empty, the Vegetarian Butcher logo’s were used for products that had not been approved and an important number of third party products were offered for sale. After the parties failed to find an amicable solution for their dispute, the original Vegetarian Butcher had terminated the collaboration agreement, requesting that the Amsterdam based Vegetarian Butcher ceased the use of both the Vegetarian Butcher trademark and trade name. Furthermore, he requested assignment of the domain www.devegetarischeslageramsterdam.nl, being the Dutch equivalent for <vegetarian butcher in Amsterdam>. Finally, recovery of full legal costs (about € 25K) was requested on the basis of the Dutch legislation implementing the Enforcement Directive. In his counterclaim, the Amsterdam based Vegetarian Butcher disputed the termination of the contract and claimed a huge amount of damages (about € 250K), arguing that he could not recover his investments.

In Court

The case was dealt with by the Amsterdam District Court in summary proceedings, as the original Vegetarian Butcher had an urgent interest to put a term to the unauthorized use of his trademark. The Judge recognizes that this dispute boils down to a different interpretation of the collaboration agreement between the parties. In such situation, it is standard practise that the Court establishes what would be the most reasonable interpretation to be given to the agreement, taking into account all relevant circumstances of the case. As one of these circumstances, the Court states that the collaboration agreement was based on a Letter of Intent (LoI) drafted by the Amsterdam based Vegetarian Butcher. In this LoI, it was clearly stated that the original Vegetarian Butcher supplies should have an exclusivity position in the Amsterdam shop. Only in the situation that the original Vegetarian Butcher was not in the position to supply sufficient products to the Amsterdam shop, the latter was at liberty to sell third party vegetarian products, provided that the origin thereof was clearly indicated.

Contract based IP enforcement

Based on the above, the Court decided that the termination of the collaboration agreement was valid. As a consequence, the Amsterdam based Vegetarian Butcher was ordered to cease and desist from the further use of the Vegetarian Butcher trademark and trade name, explicitly including any such use on social media. Furthermore, the assignment of the domain www.devegetarischeslageramsterdam.nl was ordered. Legal costs were however only partially recovered, as the Amsterdam based Vegetarian Butcher had opposed the claim for full compensation of legal costs and these proceedings were not considered complicated. For such cases, the Dutch Courts rely on a nationally agreed (but not undisputed) schedule of fixed amounts. In the present case, only 25 % of the actual claimed legal costs were awarded as a result.

Counterclaim dismissed

To no surprise, the claim for damages made by the Amsterdam based Vegetarian Butcher was dismissed. In the first place because he was found wrong, but also because it is not possible to claim full damages in Dutch summary relief proceedings. In such proceedings, it is only possible to request an advance payment of damages, provided that the existence and scope of the damages are sufficiently plausible. This was denied in the present case, as the shop in Amsterdam was allowed to continue its business, however without the use of the name Vegetarian Butcher.

Lessons to be learnt?

What is the general learning to be drawn from this case? In the first place, it demonstrates the importance to draft clear contracts regarding the use of a trademark by a commercial partner. This is of importance for any type of partnership, including but not limited to licenses and franchise. If the commercial partner does not respect the contract in place, it is good to know that such can be efficiently enforced in preliminary relief proceedings in Holland. A hearing can be obtained at relatively short notice (between 2 days and 2 months, depending on the urgency) and a decision is rendered within 2 weeks at most. For the full recovery of legal cost however, it is of the essence that the work done is sufficiently specified and that is it clearly explained what makes one case stand out from a standard case, if any.


Untraceable = unsafe?

Processed by: Helicon Filter;Dutch slaughterhouse Van Hattem suffering severe blow

This week the Trade and Industry Appeals Tribunal, (in Dutch: College van Beroep voor het bedrijfsleven) rendered its judgment (interim injunction) in the lawsuit that was filed by slaughterhouse annex meat processing company Van Hattem Vlees B.V. against an administrative enforcement decision from the State Secretary for Economic Affairs.

Recall large amount of meat

In her decision, the State Secretary imposed an administrative order to recall all meat produced or processed by Van Hattem between 1 January 2012 and 23 January 2014 (approximately 28.000 tons of meat). The request to suspend the order to execute the recall was rejected by the Court. Why? First of all, horsemeat was detected by the Netherlands Food and Consumer Product Safety Authority (NVWA) in a lot of meat that was solely labelled as beef. This is a matter of fraudulent labelling and not of food safety (see also my other articles concerning labelling and the horsemeat scandal here and here). As the investigation continued, Van Hattem failed to clarify the origin and destination of several slaughtered horses. Read below how this is relevant for to the safety of the meat.

Horse passport

Horses in the EU require a passport for identification according to Regulation 504/2008. The slaughterhouse has to check whether a horse is indicated for slaughter in its passport. If so, an official veterinarian has to perform an inspection of the live horse. Without a passport and inspection the horsemeat can be declared unfit for human consumption. Also, information in the passport such as drug use, can result in disapproval of the intended slaughter for human consumption as residues of veterinary drugs can pose a health risk for humans.

The risk of dark horses

Van Hattem was not able to fully trace the processed meat and the company’s administration showed an unclear discrepancy between the amounts of received meat and the amounts that left the company. More horses were slaughtered than were inspected and approved for slaughter. The processing of (now) unidentifiable “dark” horses poses the risk that horsemeat unfit for human consumption ends up in food products for consumers, putting consumer health in jeopardy.  The placing on the market of unsafe food is illegal according to Article 14 of Regulation 178/2002 (The General Food Law).

Was the meat in the case of Van Hattem indeed unsafe? Even though there was no evidence of unsafe food, the risk of unsafe food was sufficiently substantiated to consider the meat unsafe. Thereby an order to execute a recall was triggered based on Articles 17, 18 and 19 of the General Food Law (Article 14 is not mentioned by the Court). The Court does not place its bets on a dark horse. The Court ruled that although the order to execute a recall has a far-reaching impact on the business of Van Hattem, the order is proportionate given the circumstances.

Comparable decision re. Selten

In the ruling re. Van Hattem, the Court explained the relation between the specific circumstances and the risk of unsafe food. In a comparable judgment resulting in a recall of horsemeat, no such risk was pertinent per se. The case related to meat processing company Willy Selten B.V. The rationale for seizure in that case pertained to the facts that horsemeat was detected, which was not declared on the label and Selten’s business records could not be used to trace and identify the meat. The requested interim injuctions by this company were rejected twice (see here and here). But was there any indication that processed meat that was placed on the market was unsafe? In fact, there were not. The reasoning of the Court basically came down to stating that because the meat was untraceable, the meat was unsafe. The Court further added that it was almost certain that the veterinary drug phenylbutazone was present in one of the seized lots. But the presence of this drug poses no food safety issues according this joint statement from the European Food Safety Authority (EFSA) and the European Medicines Agency (EMA). See also this press release from the European Commission concerning phenylbutazone. In it’s conclusion, the Court in the Selten case referred to Article 14(6) of the General Food Law which reads as follows:

‘Where any food which is unsafe is part of a batch, lot or consignment of food of the same class or description, it shall be presumed that all the food in that batch, lot or consignment is also unsafe, unless following a detailed assessment there is no evidence that the rest of the batch, lot or consignment is unsafe.’

As set out above, in this case there was no indication of unsafe food, therefore the imposed order should have been lifted. It seems a tall order to base the order on Article 14 General Food Law as the requirement of unsafe food has not been fulfilled. In my opinion, the correct reasoning in this matter would have been as follows:

Untraceable = ?

Criminal prosecution

In the judgment re. Van Hattem, the Court mentions that the instrument of an order to execute recall has a far-reaching impact on the business of the company involved. In the case re. Selten, the company went bankrupt. Therefore, the instrument of recall should only be used if food safety is at stake. Especially in the case re. Selten, I have the impression that the administrative instrument of a recall is abused to punish the offenders and that the emotion and demand for action of consumers played a role here (I wonder if consumers would have responded differently if it were not horse but chicken that was mixed with beef, but that’s quite a different story). But the Court did have an escape. Without evidence of unsafe food, fraudulent labelling still constitutes a criminal offence and the offenders can be prosecuted for forgery under criminal law.

Developments

The supply chain of processed meats is complex and lengthy. The existing EU traceability systems are not adequate to pass on origin information, because the legislation is primarily based on the need to ensure food safety. The horsemeat scandal clearly showed this. The debate concerning COOL might therefore give rise to changes to the traceability systems and the proposed new Regulation on Official Controls aims to strengthen the enforcement of health and safety standards. Further, supermarkets in the Netherlands have announced to tighten the required certification for all suppliers. At end of this month the Global Food Safety Initiative will launch the module “Food Fraud”. The Dutch food industry federation (FNLI) welcomes this initiative and urges its members to add this module in their food safety system.


Smarter rules for safer food: draft regulation on official controls

European_Commission_LogoOn the 6th May 2013, the European Commission adopted a proposal for a draft regulation on official controls and other official activities performed which aims to strengthen the enforcement of health and safety standards across the “agri-food chain”.

This is an important Regulation, which will have an impact on every food business, producer, operator and Competent Authority in the EU.

Currently, the legislative framework for the organization of official controls is established through Regulation (EC) No. 882/2004. The new proposal aims to put in place a more robust, transparent and sustainable regulatory framework that is better “fit for purpose” which will repeal Regulation (EC) No 882/2004.

The proposal is part of a ‘landmark package’ which also includes major reviews to modernise, simplify and strengthen animal health, plant health and plant reproductive material legislation. The current body of EU legislation covering the food chain consists of almost 70 pieces of legislation. The package of reform will cut this down to 5 pieces of legislation. For official controls this is achieved by integrating the current applicable rules in specific areas currently governed by separate sets of rules (e.g. controls on residues of veterinary medicinal products in live animals and animal products, and plant health controls) into the framework of the new official controls Regulation.

Watch this video for the statement of Tonio Borg, Member of the EC in charge of Health and Consumer Policy, concerning this major reform.

An overview of legislation that will be repealed or amended through the proposed Regulation can be found through this link (see page 2). More information can be found here, here and here.

Some highlights

  • Broadened scope to include the whole agri-food chain. The new areas included are plant health, plant reproductive material and animal by products;
  • The current system of mandatory fees to finance the effective implementation of these controls within a sustainable system along the whole chain will be extended to other sectors within the chain which are currently not charged; Micro-enterprises will be exempted from such fees, but not from controls, in order not to affect their competitiveness;
  • Member States will also be asked to fully integrate anti-fraud checks into their national control plans and to ensure that financial penalties  applicable to violations must at least offset the economic advantage sought through the violation;
  • Provisions to enhance transparency in relation to how competent authorities carry out official controls. This includes a requirement to publish more timely and regular information on the types of controls and their outcome and to establish “rating schemes” whereby consumers can consult data on the performance of retailers restaurants and other businesses;
  • The creation of a common framework for carrying out border import controls on animals and goods entering the EU;
  • Provisions allowing the Commission to adopt detailed rules across a range of areas of 
official controls via delegated and Implementing Acts;
  • Rules to facilitate official controls for on-line sales. These facilitate competent 
authorities to order samples on line for official testing without having to identify themselves. The Regulation also specifically gives competent authorities the option of closing internet sites where non compliances have been identified relating to activities of the site.

Entry into force

Approximately in 2016. It depends on when both European Parliament and Council have approved the final text of a legislative proposal. More information about the legislative procedures? Click here for general information and here for a PDF-file concerning the ‘Ordinary legislative procedure’.

Next step?

This letter was sent to the European Parliament and the Council. They will consider the Commission’s package of measures and adopt their positions. When more details of the legislative planning or other news regarding this proposal are published, you will read it here!


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